Economic Decline

Taking few minutes to air my personal views on a few things.

Our economic decline affected a lot of people and businesses.  Home values, real-estate, and the stock market plummeting, bills and other commodities rising, and layoffs causing the increase in unemployment rate have a lot of people concerned and feel insecure about their future and that includes me, Anna the worker.  :)  The financial downturn started all the way at the top of banks, mortgage companies and brokerage firms which basically boils down to “greed at the top” as in serious greed.  This GREED is widely spread especially among some people with power, wealth, and utmost authority.

For instance……

When you’re a publicly traded company, you have stocks and there are individual companies that want to make money.  Company officials want to make as much money as they can because the more money they make, the more their compensation is and the more their stock price goes up.  There’s associated bonuses for the big wigs when they meet their numbers.  However, such reward shouldn’t just be based on numbers alone but the overall results of their performance including how well they’re doing with employee development.  Yes, “Employee Development” — there’s truly such a thing.  Managers have this type of responsibility to each of their employees.

In my opinion, if I own a company, I’ll make sure that I put the people first.  I believe in taking care of the people and investing in the people as they’re the engines that run the company.  I will capitalize in the best asset of my company, my entire workforce.  They will help the company generate the revenues it needs and grow the business which means money, as the second priority and then everything else can follow — as in things and other things.

If our leaders put people first before the greed for money, it would’ve meant caring enough for our human capital and prevent the situation we’re in today.  Responsible leadership means avoiding situations that create debts that we can’t afford or put us in situations where we overcommit and end up having to under deliver.  This is certainly not a good position to be in for anyone including the company or even the country.  I also believe that the lack of regulations and processes contributed to our downfall.  Some of these weren’t made “important” or were chosen to be “ignored” or simply weren’t established because they would cut into the bottom line or someone’s bonus, incentive or some type of personal gain.  I refuse to believe that “business essentials” were simply missed or overlooked especially when people in control are getting paid the amount of money they’re making.  In my opinion, regardless of how much salary you managed to negotiate with a company or even the government, if you do not deliver, you’re extremely overpaid.  The decent thing to do in this case is to step down or at least give some of that money back.  Equally important is sense of accountability and making people accountable.  You can’t expect a different result unless you make people accountable.  Agree?  [Oh man!  Am I on a roll or what?]  ;)

Back to Wall Street — The way I understand it is, the more money the brokerage firms, the mortgage companies and all those companies made, the better the economy was.  Because if they lent you money, you had money now that you could spend.  When the economy looks great, everyone feels like, “Oh, we’re doing great!”  The stock market goes up.  When the stock market goes up, the price of shares go up.  The compensation for the CEOs go up.  As things progressed, many of us fell under Wall Street’s spell.

On Main Street — There’s a lot of people who built their personal financial foundation on deceit and lies.  They bought home or homes, cars, and other things that they can’t afford.  They spent money like it was going out of style and it wasn’t their money to spend, because why?  They were “borrowing” it.  When you borrow money, you leverage yourself.

The United States of America leveraged itself so high that when it started to come down, the whole thing now has fallen down.  With all that being said, do you see where I’m coming from as in how this applies not only in the country as a whole but even in our lives?  at home?   even at work?

We are multi-trillion dollars (close to $50T, I believe) in debt which averages to about $450K per household.  Being in this deep of a hole is certainly not the American dream.  However, there’s hope should we choose to make it a way of making our dreams a reality.  There’s this saying, “When things are bad, we take comfort in the thought that they could always be worse.  And when they are, we find hope in the thought that things are so bad they have to get better.”

Time of Intense Difficulty

Anywhere you look — online, tv, newsstands, grocery stores, work place, etc., America’s money crisis is beyond painted all over but more of etched in our daily lives.  It’s so depressing.  Our economic climate has severely affected our country’s resources, businesses, and individuals like you and me.  So many Americans lost their jobs and I won’t be surprised if there’s another round of axes ready to cut more human capital.  This is all too common in an economic downturn.

In today’s news, they’re saying that when credit freezes up, businesses find it tougher to secure financing needed for daily operations including payroll.  This means that more companies will have to take a careful look at business operations in the current climate and in some cases, may have to make some very, very tough decisions.

We are in a recession.  When we must cut our workforce, companies or employers should keep their top performers, their A-players or their best talent based on performance, proven track record, or results, and their productivity.  In addition, ensure that whatever it is that you do that there’s actual business need for your role.  If you’re one of those that get paid the bucco bucks, just make sure that you’re worth every penny, you’re getting paid.  Without results, outstanding performance, and all that good stuff, in my opinion, you’re overpaid.

During these tough times, it is not unusual to see companies slashing even entire departments, offices, or even regions, if they are not cost effective, or dismantling divisions that are costing more money than they’re bringing in.  In many of those cases, all or most employees in the department, offices, regions, etc. will get pink slips, regardless of their length of service or loyalty, performance, or salary.  It really isn’t anything personal but simply a business decision to keep the business alive and running.  Some companies will try to redeploy some of their workers to other areas within the company to maintain employee confidence and retain the top performers.

Hmmm….  with all that being said —- we may not always be ready for whatever possible “change” may come.  However, we can always prepare.  

Layoff Bloodbath? Now what?

According to the latest news, it’s been a layoff bloodbath today. Heavyweight companies such as Sprint, Home Depot, GM and a few others had to cut a massive amount of jobs to the tune of 45,000! In addition, service innovator such as IBM will be cutting approximately 3,000 jobs and Philips Electronics another 6,000 jobs! Wow!  Where I live, unemployment rate is up 1% from last year’s 8.1% which means 1 in every 10 Americans is unemployed.  As we’ve all heard many times, this is not even the end as there’s worse times yet to come as more jobs are cut, more people lose their homes and more people get into deeper debts.

Hearing and seeing about this type of broadcast surely doesn’t fuel hope for Americans to find new jobs or keep their current jobs in order to stay in their homes and avoid getting deeper in the hole. So, what’s the reality of these layoff numbers? Is there anything good with this type of situation? What does it mean for the Americans? for the country?

These cuts are mainly coming from the big giants (industries and corporations). Reduction in force came from various sectors like construction, auto industry, technology firms, and others. Some of these companies have been hurting for a long time and some of them saw this predicament coming. As I mentioned before, in every bad situation, there’s always some kind of a good “take away”. To some companies, this is an opportunity to cut the fat, sever ailing divisions, restructure, do away with products and/or services that don’t work nor longer supports the current business model. What this means for the Americans is allowing ourselves the time and space to think things through on how we can navigate out of this downward spiral; how we can be more strategic in our decision-making for long-term growth and not just survival. For the unemployed, this might be the time to re-invest in sharpening our saws or look for opportunities as an entrepreneur; re-connect with others and identify a need that you can fill that’s of great value in this current economic climate. For the country, it means we are faced with a lot of challenges. We’re in a recession and though it’s easy to feel fear, now is not the time for fear. We need hope and serious action from our leaders.

If you’re currently employed and feeling uncertain about how the company you work for is doing, you need to do some research. If you work for a publicly-traded company, this information is available online. Review their financial statements, read any press releases, and also, see what analysts have to say to give you an idea of the health of your company. You do not need to wait for your boss to tell you as sometimes, management is not at liberty to say certain things at certain times. However, if you work for a private company, exercise the “open door policy” and talk to the boss. There’s nothing wrong with asking questions perhaps, this can even be an opportunity to discuss how you can help the company get through such challenging times. Be proactive. Good bosses will appreciate that. 

If you’re currently unemployed, such as myself, doing your homework about target companies to work for would be extremely helpful. Not only you’ll learn how financially sound a company is, you’ll also learn about their business, and learn about what’s on the press release. Reading and learning will bring you wealth of information. Remember, knowledge is power. 

Unemployed or not, I think it’s wise to pay attention to booming industries and growing companies. Also, it may be a good time to consider taking classes, training, or seminars especially if what you’re currently doing or technology you’re using is becoming obsolete or fossilized like the dinosaurs, the time is NOW to get crackin’. Some people have marketable skills but are faced with a challenge of still being unemployed or just can’t seem to land an opportunity that parallels those valuable skills. It may be best to weigh other options or rethink the companies you’re sending resumes to or even the town where you live and perhaps, relocation is the next best thing.

There are jobs to be filled regardless of the high unemployment rate. The key is figuring out where these jobs are and if you have the skills or have great value to offer a company that differentiates you from the rest. You need to have an edge especially considering it’s highly competitive out there. You may also want to go for the unadvertised jobs rather than the ones posted online or the newspapers. Have your own “brand”, your own USP as interviews are not only about interviewing a potential employer but also selling yourself and beat competition.

As for me, I know what I want and I won’t settle for anything less just to get a pay check. We all have different situations, have different goals or motivations. There are so many different elements as we all have our own various reasons. I will go for what would be in the best interest of my career goals and what’s commensurate with my qualifications. In addition, I also do not think it’s right for me to accept an offer just to accept a pay check. I do not believe that to be fair to me nor is it fair for a company. I take pride in my work and delivering on a job well done. I believe in earning every penny I get paid. I provide measurable value and deliver high impact results. In my opinion, someone that delivers high impact and exceptional value should be compensated accordingly and someone unqualified, unable to deliver or provides minimal impact and of no value is overpaid.

Again, this is just me… and what I believe in and what I stand for. I’m not filthy rich but I’m also not dirt poor. I’m fortunate to have the ability to weigh my options and the ability to wait for the right opportunity where I can provide value that matters to the company I work for. I firmly believe that it will come, in due time.